NIU Coffee Fund

'Coffee Fund' Case Comes To An End

Jun 21, 2013

The Northern Illinois University “coffee fund” investigation has come to an end with a plea agreement this week with the last of nine original defendants.

Kenneth Pugh, 57, director of NIU’s Materials Management department, was one of three supervisors who pled guilty to a misdemeanor for their roles in the case.

Charges against six of the nine NIU employees charged with felonies were dismissed. Seven of the defendants have returned to work at NIU and one more is expected to return soon. One retired before charges were filed

Susan Stephens / WNIJ

DeKalb County State’s Attorney Richard Schmack has dismissed all charges against Susan Zahm in connection to the ‘NIU Coffee Fund’ case.


Police Chief Don Grady continued to draw a salary after he was placed on leave in November.  His salary at the time was around $205,987.92. Grady and another officer were accused of withholding evidence in a sexual assault case. The charges for that case were initially dropped, but have been re-filed.


Five of the employees returned to work last Wednesday, another returned on Monday. According to university spokesman Paul Palian, NIU's Office of the General Counsel has reviewed the records, university policies and reports related to the employees who were placed on paid administrative leave during the police investigation of the coffee fund case.

NIU Media Services

Northern Illinois University President John Peters explains his silence on several controversial matters and asks the campus to stick together. 

Friday was the first court appearance for six of the Northern Illinois University employees accused of theft in a case known as “the coffee fund.”


Six of the eight current NIU employees charged as part of an ongoing investigation into an unauthorized account are scheduled to appear for a status hearing Friday afternoon in a DeKalb County courtroom. 

Susan Stephens / WNIJ

The coffee-fund investigation at Northern Illinois University is now playing out in the court system. The school recently placed eight employees on administrative leave.

Those employees were charged in connection with a secret bank account. The probe was launched over the summer after the fund’s existence was revealed in a local news report. It came on the heels of separation agreements for two former administrators. The university has issued public statements about recent events, but some in the community question whether the school is being open enough with the public.


Northern Illinois University has placed eight employees facing charges as a result of the 'coffee fund' investigation on administrative leave.  NIU said the action came "after a thorough review of state civil service statutes and regulations as well as university employment policies and practices."  The employees will continue to draw their regular salary while investigations into the fund by the NIU Police Department and the DeKalb County State's Attorney continue.